MITT ROMNEY, FORMER MASSACHUSETTS GOVERNOR: Thanks, Sean. Good to be back.

HANNITY: I'm usually looking over my shoulder right behind you over there when I get to interview you.

I got a lot of questions about politics. There is something, though, that you've said in this book that I really love. I love what your father and your grandfather, what you described, your grandfather, first of all, had construction business. It went bankrupt a number of times. Your father made you do weeding in your backyard. I'm glad we all had jobs we hated.

ROMNEY: Not exactly heavy lifting, but yes.

HANNITY: Well, listen, without a weed whacker?

(LAUGHTER)

HANNITY: It's kind of hard work. And he said to you, "Mitt, the pursuit of the difficult makes men strong." Did that change you?

ROMNEY: Well, I heard it so often. I'm sure it had some impact. And Dad figured that one of the most important things you could teach a young man or a young woman was how to work.

And so he gave us chores and gave his responsibilities. He took us into the office to see what he did. And we learned that working was a big part of the American experience and as a result I like to work, and I've done my best to teach my kids how to work and I think they do pretty darn well.

HANNITY: Well, you know — you'll know when my kids are here because you usually hear their footsteps stomping around the background when they run around the studio.

I think everyone in America — and I'm going to ask this in the context of this, because I worked — I was delivering papers at 8. I was scrubbing pots and pans at 12. I did every job there was in a restaurant. I've worked at every construct job imaginable in the course of my life. And then somehow I don't know how I got here.

(LAUGHTER)

HANNITY: But it really has made me a stronger person. I wonder if Americans are losing touch with — and you address this in the book — with that work ethic that made us strong.

ROMNEY: I think there's a real concern about that, particularly in a setting where you might have a mom that doesn't have a spouse at home, whether through no fault of her own or whether by choice, it's real hard if you haven't got two people to spend the time to invest the energy to get a child to work.

It took my dad a lot more effort to have me go out and shovel the snow with him on the driveway than just for him to hire a plow company to come in and do it.

HANNITY: Your mother should have done what my mother did. She said your father is going to have a heart attack. Go get — go shovel the snow. I mean just scared the living daylights out of me.

(LAUGHTER)

ROMNEY: It is a big part of the American experience. It's part of the culture that made America America.

HANNITY: Right.

ROMNEY: Hard work, sacrifice for the future, getting education, providing for your family, faith. And all these things are part of the American culture that led America to be the powerhouse that we have become.

HANNITY: But you say America will only remain a leader in the world if we overcome challenges if we don't face them. Are you worried that America is losing its exceptionalism in that sense?

ROMNEY: Well, there's no question but that America is an exceptional role and that we provide a great deal of lift for the entire world.

Look, our system of free enterprise has helped lift literally billions of people out of poverty.

HANNITY: Right.

ROMNEY: We — our fighting men and women have helped provide freedom for people around the world.

HANNITY: Right.

ROMNEY: But — so American exceptionalism is real and true. But I've seen the kinds of challenges that we face year in and year out not being addressed. And as a result of that I think that there's a very great risk that America will be eclipsed at some point during this century by another nation or nations that may not value freedom and free enterprise the way we do.

HANNITY: But you actually refer to this in the book. And it reminds of the story that a guy I met that does a lot of work with China. There are countries, China in particular, who's looking at the United States as the new Europe. As sort of their better days are behind them because of the decisions we're making. How bad is it?

ROMNEY: Yes. I mean it's very bad. I mean you go through it piece by piece and you say all of the elements that are in place in our country that would suggest a long term decline are very much like the elements that were in place in other great nations in the past that declined.

And I laid that out in the book for obvious reasons. And then you go through one by one and say you know what? We can overcome those challenges if we're just willing to honestly face them.

And you go through them one by one. We spend too much money. We're living on a credit card that's been issued by the Chinese. That we got to stop doing. We have massive entitlement liabilities which we're not willing to rein in. We've got to make sure our entitlements are sustainable.

Our schools are at a crisis level. Our kids are not getting the education they need for the 21st century. We're addicted to oil. We buy 62 percent of our oil from nations many of whom that don't particularly like us.

You go down the list of challenges we face. We could overcome them, but if we just keep kicking the ball down the field, America could find itself in the position that nations like France are today.

HANNITY: How bad do you think it is? I mean, for the average person out there, watching they read about unemployment numbers, they hear about the economy, America may lose its AAA rating, debt, deficits.

You know, everything that we discussed on a regular basis. How bad do you think it is right now?

ROMNEY: Well, there are two concerns. One is the immediate crisis that we face. And that's really bad. Not just for the 10 percent that are unemployed but for the many others that have given up looking for jobs and for those who are worried about becoming unemployed.

It's bad immediately. And unfortunately, the president has not taken the action that he should have taken to get people back to work. Instead he's been focusing for, what, a year and a quarter now on health care?

My goodness. Jobs, that's number one. But number two, longer term, if you look 20 years down the road, which is when you get old like me you think about your kids and your grandkids.

It's very concerning there as well. We've got about $60 trillion of unfunded liabilities in this country.

Look, my generation is going to become known as the worst generation unless we take action to bring correction to these kinds problems. And if we do, well, look, we'll do just fine. And I'm convinced, by the way, we're going to do fine because Americans rise to the occasion.

HANNITY: All right, I'm listening to somebody that I'm reading is going to be compelled to run for president again. But don't answer that question.

(LAUGHTER)

HANNITY: Because I'll ask you when we get back.

ROMNEY: I'll think about that some other time.

HANNITY: All right. We're going to take a break. We'll come back, more with Governor Romney in his first cable interview about his brand-new book. That and much more straight ahead.

(COMMERCIAL BREAK)

HANNITY: And we continue now with the author of the brand-new book, "No Apologies: The Case for American Greatness." Mitt Romney is with us.

All right, so what do you make of — for example — what's going on — you have the Washington Post today, unidentified Democrat. All right. Fair enough. Unidentified is always a bad deal.

But saying that the White House is tone deaf. That they're sacrificing the members of Congress in the year 2012 and they could care less about the people on the streets of their districts.

Do you think Barack Obama is tone deaf? What do you think of him?

ROMNEY: Look, I think he's a lot worse than tone deaf. I think he has such a low level of experience in dealing with tough situations like this that he's made some classic errors. One of which is not to focus on job one from the first day he was in office.

HANNITY: Yes.

ROMNEY: And that, of course, was getting jobs back to the American people. And then the second issue should have been making sure that we're successful in our fight against terrorism around the world particularly in Afghanistan.

But instead he diverted onto health care. And what he's doing for the Democrats right now is really — I'm sure for a lot of them very, very frightening. He's making senators and the representatives walk the plank.

HANNITY: Yes.

ROMNEY: And by the way, if they lose, and somehow they were to lose both Houses of Congress, I had someone say to me he wouldn't mind that so much then he can blame the Republicans for the problems that are certainly going to be coming over the next few years, because this economy is not turning around as quickly as it could have, had this president taken the right action from the outset.

HANNITY: So the transition from blaming Bush to blaming the Republicans who just took over Congress. I got — that's a good mentality.

Well, we got job members coming out on Friday. Lawrence Summers is suggesting that because of the bad weather and blizzards that the numbers aren't going to be what they expected to be. That's on the economic front. On the national security front, hasn't made really a lot of news today.

But the president proposed today a 50 percent unilateral cut in our nuclear arms. Saying that this will be a good example to other countries that are pursuing nuclear weapons.

ROMNEY: Well, he has pursued this strategy time and again. The first time, I think, in a significant way was when he said we're going to take out the missile defense system from Eastern Europe.

Kicking the sand in the that face of the Poles and those of the Czech Republic in order to reset relationship with Russia. And what do we get for it? Did we get tough sanctions again Iran that we've been aiming for? No. We didn't get anything.

The first rule in negotiation is if you're going to give something, get something. And the Soviets and we have a very similar number of what are called strategic nuclear weapons. That means they can be put on rockets and go across a long distance.

But tactical nuclear weapons are the same warhead that is going on to smaller rockets. But the Russians have many times the number of tactical nuclear weapons we have. So when the president keeps cutting back our strategic nuclear weapons he's making us potentially vulnerable.

HANNITY: Yes — no — well, I think he's done that already. I mean isn't that pretty much what has happened?

You know we've got Eric Holder. They're going to have — the Khalid Sheikh Mohammed, his co-conspirators, that trial in New York. We don't interrogate this guy that's got a bomb in his underwear at Christmas time.

And now we find out that he hired, what, nine lawyers that were representing the guys we're holding — the terrorists we're holding in Gitmo. You think he has put this country at risk? Has he made it less safe for the average American?

ROMNEY: Well, I think by virtue of the missteps that have occurred around the world where he has in some respects pulled back from our friends and been unwilling to stand up to our foes, he has emboldened people to take actions which make the world less safe.

One is certainly North Korea is pursuing head long. Their additional nuclear capabilities. Iran has not been dissuaded in any significant way to pull back from their nuclear ambition. That makes the world less safe.

The president has been unsuccessful in making a headway on either front. The vice president I think — said that the president would be tested in his first few days in office and he has been.

And he has, in my view, while he has the greatest of desires to help the country, I'm sure — he's made some enormous errors.

HANNITY: OK. So I'm listening to you and I'm reading your book. You are one thousand percent engaged from start to finish, A to Z, on the economic situation in the country, on national security issues in the country.

You made one run for president. You've got — you have to be thinking about another run. I mean it's in your head.

ROMNEY: Well, what I have to think about is this is —

HANNITY: This is your way of ducking it.

(CROSSTALK)

ROMNEY: But I'd say — what's right for America.

HANNITY: Yes.

ROMNEY: My book was actually in my mind 20 years ago. As I began going around the world doing business in different places saying, you know what? America is not as far ahead as I thought. These other parts of the world are catching up. And now I go to places like China and I say wow, look at Shanghai.

I wish everybody in this country could see what's happening there. That's what I want to do in the book, is to have people recognize how important it is for America to wake up, take the action we always take when we're faced with the truth.

But as for my running for office down the road, you know, I'll wait until after 2010. We need to get some senators elected to be able to block some of the most outrageous things that are being pursued by this administration.

HANNITY: Yes. All right. In fairness, I know you probably haven't made a decision but I would think that you're going to be thinking about it in the days and weeks to come. What do you think — what do you think the person that takes over? How massive are those problems going to be considering the debt, the deficit, the economic situation?

The projection is that — I was reading one economist in The American Spectator the other day says the coming recession of 2011 and then 2012 — is this something that becomes almost insurmountable for the next person or is it something that's going to take, you know, a decade to get out of?

ROMNEY: Well, it's very possible that the economy is going to stay very, very troubled over the near term and over several years. That's very, very possible. The president has not done an ideal job. He's frankly scared the private sector to death.

When he starts talking about cap-and-trade, he scares them. When he says we're going to raising capital gains taxes and individual taxes and corporate taxes he scares the job creators.

When he says that we're going to have card check, taking away from the American worker the right to a secret ballot, he scares the workers and he scares employers. When he says I'm going to take over health care, almost a fifth of the economy —

HANNITY: You're scaring me just repeating it.

ROMNEY: He scares — he scares the employers. And so for all those reasons he's made it more difficult for our economy to get going. Now will it restart? Yes. Because the American spirit, the innovative spirit of this country will get us going again. But he's made it more difficult and has lengthened this recession.

Ultimately, are we going to fix ourselves? Yes. Because we're going to have some leaders that step forward in the Republican and the Democratic Party who say, you know what? Things are so critical right now, we have got to fix the country.

HANNITY: Last question. If you don't run, who are three Republicans that you would like to see run?

ROMNEY: All the — all the regular names, the usual names that you hear.

HANNITY: All the regular names. What do you mean?

ROMNEY: Lots of folks.

HANNITY: First name, last names?

ROMNEY: Yes, sure. But there are some that I don't think you may have heard of like Bob McDonnell from Virginia.

HANNITY: Just got elected.

ROMNEY: He's just got elected. We're going to get a chance to see him over the next couple of years. I must admit I was out campaigning with him.

HANNITY: He's amazing.

ROMNEY: I was — very impressive. Chris Christie in New Jersey, this is a guy who has — talk about taking on a tough task. If he's able to turn that around, wow. Meg Whitman, my friend in California. She may say look, California is going to take a lot more work than being here a couple of years and then running for president. But we get some great leaders in the Republican Party as well as those that are on everybody's list.

HANNITY: All right. Mitt Romney, good luck with the book. I guess you're going to be all around the country in the next few weeks. And hopefully we'll see you out on the road.

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